How Does a ‘Protocol-to-Protocol’ Lending Agreement Differ from Holding a Third-Party Token?

A protocol-to-protocol (P2P) lending agreement involves one protocol depositing assets into another's lending pool, often for a negotiated, fixed rate. This is a direct financial relationship with specific terms.

Holding a third-party token is a passive investment, exposing the treasury to the full market and governance risk of the token. P2P lending is typically a lower-risk, more structured way to earn yield.